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Guide explains who should file ITR 1, 2, 3 and 4 for FY 2025-26, detailing income limits, sources, residency status, business and presumptive taxation criteria
Income Tax Filing Season 2025-26
Income Tax Filing 2025-26: The income tax filing season for the financial year 2025-26 (Assessment year 2026-27) is underway. Filing an Income Tax Return (ITR) is necessary for anyone earning above the basic exemption limit each year. Taxpayers, especially newcomers, get confused while choosing among different kinds of ITR forms designed for various types of income.
Each form is designed for a specific income source or situation, so it’s important to know which one applies to you. In this article, let us understand what ITR 1, 2, 3 and 4 mean and help you understand who needs to file each form.
ITR 1 Form
It is meant for resident individuals whose total income does not exceed Rs 50 lakh. It can be used by those who earn from a salary or a pension, own only one house property or have income from other sources like interest. The form can also be used if the person has an agricultural income of up to Rs 5000.
ITR 2 Form
This can be filled by individuals or Hindu Undivided Families (HUFs) whose total income for the Year 2026–27 includes different sources. It is suitable for those earning from a salary or pension, income from house property or income from other sources. It is also for people who are company directors or who have invested in unlisted shares during the year, along with Resident Not Ordinarily Residents (RNORs) and Non-Residents. If you have income from capital gains, foreign income or agricultural income of more than Rs 5000, you must use form 2.
ITR 3 Form
Individuals or Hindu Undivided Families (HUFs) who earn income from running a business are eligible to file this. The form should be used if the person is not using the presumptive income scheme and needs to maintain proper books of accounts or get them audited. Those who have invested in unlisted equity shares during the financial year.
Along with business or professional income, the return can also include income from salary or pension, house property or other sources. If a person is a partner in a firm, their share of income must also be reported through Income Tax Return 3.
ITR 4 Form
This is meant for those whose total income is up to Rs 50 lakh, along with people who earn business income under the presumptive income scheme as per Section 44AD or 44AE, or professional income under Section 44ADA. It can also be used by those who earn from a salary or a pension, have income from one house property or have income from other sources. ITR 4 is mainly used by small business owners or professionals who want to report their income in a simple way under the presumptive income method.
About the Author
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the I…Read More
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